Svmuu News Prediction markets are experiencing rapid expansion in the United States, with monthly trading volume growing from $1.2 billion in early 2025 to over $20 billion a year later, with political and sports contracts being the main trading categories. However, the industry simultaneously faces pressure from more than six legislative proposals in Congress, most of which are driven by Democratic lawmakers, with some receiving bipartisan support.
These bills cover multiple directions: The STOP Corrupt Bets Act proposes a comprehensive ban on contracts related to elections, government actions, sports, and military operations; The Public Integrity in Financial Prediction Markets Act prohibits government employees from placing bets using insider information, with the scope including the President, Vice President, cabinet members, and members of Congress; The BETS OFF Act targets trades involving sensitive events such as war, terrorism, and assassination; The Prediction Markets Are Gambling Act supports states in bringing sports event contracts under gambling regulation.
Several states have filed lawsuits against Kalshi, with a Nevada court having suspended Kalshi's operations in the state, and the Arizona Attorney General bringing 20 criminal charges against Kalshi. CFTC Chairman Mike Selig argues that the federal government has exclusive jurisdiction over prediction markets, and his agency is advancing formal regulatory rulemaking.
TRM Labs analysis shows that in prediction contracts related to previous U.S. military actions against Iran, four wallets with almost no prior trading history placed bets worth approximately $40,000 and profited $872,000, raising insider trading concerns. Currently, the probability of Democrats retaking the House of Representatives on Polymarket is 85%. If Democrats win in the 2026 midterm elections, the momentum for advancing the aforementioned legislation may intensify.